Naperville to seek bids for study of proposed TIF

The Naperville City Council has directed staff to send out bids to consultants to help decide whether two adjacent downtown commercial parcels might qualify as tax increment financing districts.

Several weeks ago, Moser Enterprises Inc. suggested a TIF for its proposed redevelopment of the 4.1-acre commercial area stretching from the south side of the Riverwalk near Water Street to Aurora Avenue and from Main to Webster Streets.

Since 2001, the city has been preparing a conceptual guide for the same area.

Moser has proposed building an amphitheater, a three- to six-story hotel, several restaurants, a six-story residential building, several commercial areas and a five-story parking deck.

Earlier this month, the council received a draft of the request to be sent to consulting firms. The staff's draft added a second area immediately east of the Water Street block extending from the north side of the Riverwalk near Chicago Avenue south to Aurora Avenue and from Main Street east to Washington Avenue.

If either area were to be established as a TIF, the sum equal to the current property taxes would continue to be awarded to taxing bodies. Future property taxes over that amount would be diverted, typically for 23 years, to pay for specific costs of the redevelopment. City Manager Peter Burchard said a feasibility study would lay the framework if the city meets TIF criteria. It is "critical" to beginning to forecast what type of taxes, revenue and other numbers would be involved if the city were to go with the TIF, he said.

Council member Richard Furstenau, who opposed the proposal, said the additional area only aggravated his earlier misgivings of taking any action that presents Naperville as having a blighted downtown.

"This is very troubling to me," said Furstenau. "We were talking about one area and now it has expanded. We have to take a good, close look at what we are proposing here."

Moser had pledged $25,000 to cover the cost of the Water Street area feasibility study. But with the expanded scope, Burchard said, the city needs to see how much consultants are bidding before approaching the company about footing the entire bill.

The city will require consultants to return bids that detail the steps going into the study.

At a minimum, the city expects such a study to include a summary of land uses and conditions of the areas; to recommend preliminary boundaries for any projects based upon the state's TIF statute; and to determine if there are any qualifying factors such as a blighted area.

The study is also expected to define a strategy for implementing a TIF, provide initial projections of what the tax increment revenue would be, provide alternative debt financing and identify public improvements that are eligible for the TIF.

Council member Gary von Behren said he favors allowing the issue to go out for bid to see the cost of the studies because either Moser would agree to pay for the study or back off the idea.

But if the studies were to be done, he said, they would be "good educational tools to understand the value of a TIF."

Besides the city, other taxing bodies also would receive fewer taxes during a TIF period. Burchard told the council he had spoken with Don Weber, superintendent of Naperville Community Unit School District 203, to let him know the council was exploring the idea of a TIF.

Burchard also assured council members that if Naperville decided to go with a TIF for either area, the city would retain control on its terms.